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Friday 11 April 2008

Info Post

Broadly speaking, the nuclear energy community is in favor of a diverse energy mix. The current mood of the country has tied nuclear power ever closer to its green brethren, and the energy companies that own nuclear energy plants are likewise friends of old man Sol and Aeolus god of the wind. However, oil is driving everyone nuts. Here's Lester Thurow in the Los Angeles Times:

There is a solution to the rising cost of oil, but it is a painful one. Let's say there is a lot of $20-a-barrel oil in the world -- deep-sea oil, Canadian tar sands. But who would look for $20-a-barrel oil if someone else (Saudi Arabia) has lots of $5-a-barrel oil? The answer is: no one.

Basically, American taxpayers have to guarantee potential producers that the price in the future will not fall below $20 a barrel and that they will not lose their investments.

This is easy to do. The U.S. needs to guarantee that it will buy all of its oil at $20 a barrel before buying anything from OPEC. This forces the price of oil down to $20 a barrel, but it eliminates the possibility that it will ever go back to $5 a barrel.

Thurow is a professor of management and economics and dean emeritus at the MIT Sloan School of Management, so he knows whereof he speaks. But "This is easy to do?"

You might call this a stealth action in favor of alternative energy - that hybrid car idea that Jay Zawatsky was pushing the other day certainly gains an allure - but Thurow seems to be on a higher floor of the ivory tower than most. Ground level, the word is nuts.

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